Australian Corporate Accountability Network of Australia

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The Australian National Contact Point is failing

Australia's only government body charged with hearing complaints of human rights by Australian business abroad is failing.  A new report finds that the Australian National Contact Point is tucked away in Treasury and barely resourced.  The majority of complaints are dismissed at the initial assessment stage.

Australian companies now operate all around the world in mining, manufacturing, finance and other industries.  Sometimes this is through wholly owned subsidiaries, sometimes they invest in joint ventures or part shares, and at other times Australian businesses procure parts through supply chains.  What happens when these operations negatively impact the lives of local communities or workers overseas?  Who can communities turn to when they are displaced by a mining operation without fair compensation, their lands are polluted and made infertile or workers are exploited? Though, in principle, communities can take their claims to local police and courts, in many countries that Australian businesses operate corruption, bias and long waits often makes remedy through legal avenues impossible.  Furthermore, company structures make it difficult to hold the parent company or a lead company in a supply chain responsible, even though that business may be calling the shots.

Though you may not have heard of it, and its name provides no clue to its vital role, these communities and individuals can lodge claims with the Australian National Contact Point.  Bodies with the same unhelpful name operate in all OECD countries. This quasi-judicial mechanism is charged with implementing the OECD Guidelines for Multinational Enterprises in Australia (Guidelines).  The ANCP is particularly important because it is the only avenue for redress for many communities and individuals affected by Australian business outside our national borders. Australia does not have a legal framework that specifically regulates the human rights obligations of Australian corporations overseas.[1]

Given its central role in the Australian human rights landscape, it is vital that it offers effective redress. Indeed, the ANCP, if it functioned as intended, could provide access to mutually beneficial outcomes that may not be achievable through complex and expensive judicial mechanisms.  Its designers envisaged affordable, timely and responsive redress of breaches of internationally agreed norms.   Mediated outcomes, arrived at with the assistance of government, could be great for both Australian business and communities: far better than being embroiled in a lengthy and expensive court case, for example, or exposure by the media. And far better, surely, than doing nothing.

However, the body is failing to achieve its mandate, a new report published today by a joint project of universities and civil society organisations has found. The report, The Australian OECD National Contact Point: How it can be reformed, assesses the performance of the ANCP and finds that it is barely functioning as intended under the Guidelines. Instead, the report finds that the ANCP has all but abdicated its workload: the ANCP has rejected or transferred (to another NCP) two thirds of all complaints made. With only one exception, the remainder of accepted complaints were closed without resolution, as the ANCP was unable to bring the parties to mediation and unwilling to issue a determination against the company the subject of complaint. In the over ten years since its establishment, the ANCP is yet to make a single determination against a company the subject of complaint.

Why? It may sound sinister, as if the government is purposefully trying to limit access to remedy for vulnerable communities affected by Australian business.  But really, the cause is simple neglect.  For years now, one public servant in Treasury who already has a full-time load of other work has been tasked with running the ANCP. This single staff member, with no expertise in the area, has been expected to deal with significant human rights complaints involving some of Australia’s biggest companies, in his spare time, with no dedicated budget.

To provide a point of comparison, the Dutch NCP is independent and consists of four independent members and four advisory members from the government departments most relevant to business and human rights.  The Dutch government allocated significant funding (€900 000 over three years) plus two full-time staff to its NCP, in addition to those staff who have responsibilities to the NCP as part of their other duties.[2]

At a time when Australia is seeking to strengthen its human rights mechanisms as part of its bid for a seat on the United Nations Human Rights Council, and when modern slavery – especially the extent to which it taints the supply chains of Australian businesses and businesses operating in Australia – is the subject of a parliamentary inquiry and national attention, it is essential that the ANCP be strengthened.

The report makes several recommendations [hyperlink to the recommendations] regarding how the ANCP can improve its functioning and provide access to remedy, including:

1.      Improve the independence of the ANCP and properly resource it:

·      The ANCP sits exclusively within the Treasury Department. It appears to dismiss complaints made against companies carrying out work for the Australian government on the basis that it would be inappropriate to handle such complaints.

2.     Improve the process for handling complaints, particularly those that impact admissibility:

·      The ANCP’s high rejection rate appears to be based on the taking into account of criteria irrelevant to admissibility under the OECD Guidelines.

·      Even where cases are accepted, uncertainty clouds the process, with timeframes for resolution having blown out over the past few years.

3.     Increase transparency and improve outreach:

·      It is crucial that the ANCP provide details on the website about how to submit a complaint, and reports on all of its findings.

·      The ANCP also has a responsibility to also improve outreach, which could be achieved by following up and offering assistance for cases which it transfers to foreign NCPs, as well as conducting training and providing education on the Guidelines for government departments, business communities, civil society and any other relevant stakeholders.

Rumour in the corridors of Treasury is that the government is about to call a review of the Australian National Contact Point.  This could be a fantastic opportunity to move the mechanism out of Treasury, strengthen its independence and functioning, and properly resource it.  We wait with baited breath to see how seriously the government takes this opportunity to be a champion for human rights and earn a place on the United Nations Human Rights Council.

[1] Committee on the Elimination of Racial Discrimination, Concluding Observations of the Committee on the Elimination of Racial Discrimination, Australia, 77th sess, UN Doc CERD/C/AUS/CO/15-17 (13 September 2010) [13].  It has implemented anti-corruption laws that impact the operation of Australian companies that interact with foreign governments abroad: Criminal Code Act 1995 (Cth) s 70.2, which implements the requirement in the OECD Anti-Bribery Convention to make it an offence to bribe a foreign public official. However, unlike other implementing countries like the UK and the US, Australia has had no successful prosecutions under its anti-bribery of foreign public officials laws: see Cindy Davids and Grant Schubert, ‘The Global Architecture of Foreign Bribery Control: Applying the OECD Bribery Convention’ in Adam Graycar and Russell G Smith (eds), Handbook of Global Research and Practice in Corruption (Edward Elgar, 2011) 319, 326, 328, 337; see also OECD, Progress Report 2015: Assessing Enforcement of the OECD Convention on Combatting Foreign Bribery (2015) 15.

[2] OECD Watch, Model National Contact Point (2007) 8 <http://www.oecdwatch.org/publications-en/Publication_2223>.